COVID-19: Tax Relief
- IRS Surprise Announcement: Automatic Abatement of Failure to File Penalties for Tax Year 2019 and 2020Taxpayers affected by the Covid-19 pandemic will be relieved of certain listed failure-to-file penalties relating to 2019 and 2020 tax returns without having to request the relief. For income tax filers to qualify for this penalty relief, any “eligible income tax return” must be filed on or before September 30, 2022. Common eligible returns include: Form 1040, U.S. Individual Income Tax Return Form 1041, U.S. Income Tax Return for Estates and Trusts; Form 990-PF, Return of Private Foundation; Form 1120, U.S. Corporation Income Tax Return; Form 1120-S, U.S. Income Tax Return for an S corporation, and Form 1065, U.S. Return … Read more
- Report of Taxable 2020 Unemployment Insurance Benefits for New YorkersAs a result of the pandemic and the economic crisis, many New Yorkers received unemployment benefits in 2020. Under current law, these benefits are fully taxable for federal and New York State income tax purposes. Form 1099-G provides the total amount of money that recipients were paid in benefits from NYS DOL in 2020, as well as any adjustments or tax withholding made to their benefits. New York State will not automatically send Form 1099-G to taxpayers. There are two ways for you to obtain it: Go to your online account at labor.ny.gov/signin to download, or If you do not have … Read more
- Employee Retention Credit: Potential Refund for Qualifying BusinessesThe recent Consolidated Appropriations Act signed into law on December 27, 2020 made significant changes to the Employee Retention Credit (ERC) which could result in tax refunds for qualifying businesses. In order to claim the ERC employers must meet one of the following criteria: Highlights of some of the significant changes to the Employee Retention Credit by the Consolidated Appropriations Act follow: Please contact your Gettry Marcus Advisor if you would like assistance in determining your eligibility for this tax credit, or quantifying the credit.
- Congress Passes New Stimulus BillAt Gettry Marcus CPA, P.C. we continue to stay up to date on the recent developments regarding the relief efforts put forth by Congress with respect to the Covid-19 pandemic. On December 27, 2020, the President signed into law the new Emergency Relief Bill of 2020. See the below link from the Journal of Accountancy for a summary of the new legislation as it affects PPP loans: https://www.journalofaccountancy.com/news/2020/dec/covid-19-relief-bill-addresses-key-ppp-issues.html If you would like additional information on specific impacts to your business contact Gabe Shurek or Nicholas Backmann, the authors of this article.
- Income Tax Provisions of The Consolidated Appropriations Act, 2021On December 21, Congress passed The Consolidated Appropriations Act, 2021 (CAA 2021), which was signed by the President on December 27. The following are highlights of the key changes affecting income taxes in the current version of the Act: Under the CARES Act passed last March, individuals who normally do not itemize deductions may take up to a $300 (including joint filers) above-the-line deduction for cash contributions to qualified charitable organizations, for the year 2020. CAA 2021 extends this deduction through 2021 and doubles the limit for joint filers to $600. In addition, the 60% of adjusted gross income limit … Read more
- IRS Makes it Easier to Set Up Tax Payment ArrangementsThe IRS recently announced a number of changes designed to help struggling taxpayers impacted by COVID-19 more easily settle their tax debts with the IRS. Payment Arrangement Changes Short-term Payment Plans. IRS offers options for short-term and long-term payment plans, including Installment Agreements via the Online Payment Agreement system. This service is generally available to individuals who owe $50,000 or less in combined income tax, penalties, and interest or businesses that owe $25,000 or less combined that have filed all tax returns. These plans can now be extended from 120 to 180 days for certain taxpayers. Installment Agreements. Installment Agreement options are … Read more
- IRS Tax Payment Notices – July 15, 2020Many of you may have received notices from the IRS for balances due, tax penalties & interest pertaining to payments made by check which were due July 15, 2020. Please note that the IRS mailroom is behind in updating these payments as they are working with a skeleton staff. Please do not put a stop payment on these checks as they will eventually be deposited. Should you receive an IRS notice please note that any penalties and interest will be removed upon posting. If you would like additional information please contact your Gettry Marcus Advisor or Robin Rokuson, the author … Read more
- WEBINAR: Wealth Transfer Opportunities in the Pandemic EnvironmentGettry Marcus CPA, P.C. presented: Wealth Transfer Opportunities in the Pandemic Environment Topics that will be addressed include: Gift Giving – Valuation Opportunities in a Turbulent Environment Potential Estate Tax Savings – Alternate Valuation Date Reverse Gifting – Unusual times invert standard practices Loans to and from Trusts – Historically Low-Interest Rates Retirement Plans – Tax Opportunities with Loans and Distributions. PROGRAM PANELISTS Russell Glazer, MCBA, ASA, CPA/ABV, CVA, ABAR, MBA, Partner at Gettry Marcus CPA, P.C, focuses on business valuation engagements in the areas of estate and gift valuation; lost profits; commercial damages; shareholder dispute resolution; mergers and acquisitions; and … Read more
- IRS Opines on Tax Consequences of Forgiven PPP LoansUnder the federal government’s Paycheck Protection Program, businesses receiving SBA loans may have the loans forgiven if the proceeds are used to cover payroll, employee benefits, and certain other costs. Under the CARES Act, the forgiveness of the loan is not taxable. However, there was no specific provision in the statute regarding the deductibility of the expenses covered by the forgiven loan. The IRS has issued Notice 2020-32 holding that these expenses are not deductible since they, in effect, give rise to nontaxable income in the form of the loan forgiveness. It appears that although this opinion may be technically … Read more
- WEBINAR: Monetizing the Tax Changes in the CARES Act for Real Estate OwnersGettry Marcus CPA, P.C. presented: Monetizing the Tax Changes in the CARES Act for Real Estate Owners Topics that will be addressed include: Depreciation of qualified improvement property Suspension of loss limitation provisions Net-operating loss utilization Cost segregation maximization Wealth transfer with regards to real estate valuations Program Panelists Stephen Breitstone, Esq., Partner at Meltzer, Lippe, Goldstein & Breitstone, LLP, focuses on private wealth, business & real estate taxation. Stephen has the rare combination of skills as a transactional income tax attorney and as an estate planner. This combination enables him to effectively advise his private clients on their individual needs … Read more
- How to Receive Your Economic Impact PaymentFrom the AICPA Journal of Accountancy*: The IRS has launched an online portal for taxpayers who are eligible to receive an economic impact payment but who are not normally required to file an income tax return because their income is too low ($12,200 for individuals or $24,400 for married couples filing jointly for 2019). The online portal allows people to enter their required information, which the IRS will use to confirm their eligibility and then calculate and send them a payment. Under the Coronavirus Aid, Relief and Economic Security (CARES) Act. P.L.116-136, eligible individuals will receive an economic impact payment of up … Read more
- State Income and Sales Tax Extensions Due to the Pandemic EmergencyMost states are providing extensions. Here are recent developments in New York and our two contiguous states, Connecticut and New Jersey. Please contact your Gettry Marcus advisor for information on additional states. Connecticut Connecticut business tax returns are usually due one month after the federal return for the same entity. This applies to corporations and pass-through entities (e.g., partnerships and LLCs). The returns normally due between March 15, 2020, and May 31, 2020, are now due June 15th. There is no extension for estimated tax payments that were due between March 15, 2020, and June 1, 2020, nor is there … Read more
- Depreciation Technical Correction for Qualified Improvement PropertyThe 2017 TCJA consolidated certain categories of depreciable property known as (1) qualified leasehold improvement property, (2) qualified restaurant property, and (3) qualified retail improvement property into one category called qualified improvement property (“QI Property”). The Committee Reports to the TCJA indicated that a general 15-year recovery period was to have been provided for QI Property. However, that specific recovery period failed to be reflected in the statutory text. As a result, QI Property fell into the 39-year recovery period for nonresidential rental property. That also made it ineligible for 100% Bonus Depreciation. The CARES Act provides a technical correction to … Read more
- Important Tax Update: Excess Business Losses, Retirement Plan Distributions & RMD SuspendedModification of Limitation on Losses for Noncorporate Taxpayers Before the enactment of the 2017 TCJA, noncorporate taxpayers were allowed to use business deductions to reduce or eliminate their nonbusiness income in the same tax year. The TCJA added a provision disallowing the deduction of “excess business losses” by noncorporate taxpayers for tax years beginning after Dec. 31, 2017, and ending before Jan. 1, 2026. An excess business loss is the excess of the (1) taxpayer’s aggregate trade or business deductions for the tax year over (2) the sum of the taxpayer’s aggregate trade or business gross income or gain plus … Read more
- Important Tax Update: Changes to NOLs, Charitable Donations, & Stimulus CheckChanges to Net Operating Losses (NOLs) Under the TCJA of 2017, NOLs incurred after 2017 could only be carried forward, and could only offset 80% of taxable income in the year they were utilized. The CARES Act temporarily removes the taxable income limitation to allow an NOL carry forward to fully offset income for tax years beginning before 2021. For tax years beginning after 2021, taxpayers will be able to take: (1) a 100% deduction of NOLs arising in tax years prior to 2018, and (2) a deduction limited to 80% of taxable income for NOLs arising in tax years … Read more
- CARES Act – Key Tax ProvisionsCongress has passed the CARES Act. The following is a brief summary of the key tax provisions affecting individuals and businesses. More detailed information will be provided in the near future. Many of these provisions are retroactive and may require guidance from the IRS. Provisions Affecting Individuals Individual recovery rebate/credit – A tax credit for 2020 will be advanced to eligible individuals in the form of a stimulus payment. Eligibility begins to phase-out for single individuals whose adjusted gross income is $75,000 and for individuals filing a joint return at $150,000. The credit is $1,200 per individual and $500 for each … Read more
- Important Tax UpdateWe want to keep you up to date on developments affecting your tax situation during the ongoing health crisis. Please remember that the situation is fluid and things may change rapidly. Postponement of April 15 filing deadline: IRS announced that the April 15 filing deadline will be pushed back to July 15 for all income tax returns. It is not necessary to file an extension. An additional extension of time to October 15 can be requested by July 15. Postponement of tax payments: The IRS has provided tax payment relief for any person with a federal income tax payment due … Read more
Please contact your Gettry Marcus Advisor if you would like additional information.
Disclaimer: Nothing herein should be construed as being Gettry Marcus’ views as to whether this economic global crisis will be short-lived (a V recovery), take only a few calendar quarters to unwind (a U recovery), or create a longer-lived recession. Further, the above and all future communications from our task force provides information for you to consider as a menu of thoughts as no one strategy works for all.